Covered Issue 1
In this edition... Credit Insurance:
Duty to Warn
Safeguarding your Treasures
Going back to the roots
Welcome to the latest edition of Covered As we settle into 2017 I am pleased to reflect on a positive year of growth and development for the business in 2016. We had a number of new appointments across the Group, a new branch opening in Belfast and continued expansion in Edinburgh with a move to larger premises to accommodate the growing team. In November 2016 we set about preparing the company for the future. I am pleased to announce John Butterworth, who has successfully steered the firm for 20 years during his 36 year tenure, has been appointed Executive Chairman and will work closely with me as I embark on my new role as Managing Director. TL Dallas will continue to be a family business â€“ not because there are two members of the Dallas family in the business, but because of the wider TL Dallas family that are our people and our customers. We are fortunate to have a long-standing, dedicated team of knowledgeable and experienced staff who pride themselves on providing the very best advice and service to our clients. As an independent insurance
broker we have the freedom to explore every option available in the market, allowing us to provide our clients with the best solutions to their individual requirements every time. Thank you to all our customers - those that have supported and remained loyal since our earliest days and those that are a little newer to the family too. You are all very welcome and I can assure you of our commitment to continually improve the service we offer to meet your ever evolving risk and insurance needs. We are always happy to hear from you and if you have any queries or would like to give us your feedback please donâ€™t hesitate to get in touch.
Managing Director firstname.lastname@example.org
The Insurance Act 2015 Duty of Fair Presentation The Insurance Act 2015 (TIA 2015) took effect on 12th August 2016, described by UK Government as the ‘biggest reform to insurance contract law since the Marine Insurance Act (MIA) of 1906’. The latter contained provisions, which entitled insurers to avoid cover for non-disclosure and terminate for breach of warranty. TIA 2015, on the other hand, modernises how insurers approach commercial insurance policies that are entered into (or are amended) from the new legislation date. TIA 2015 has created a new ‘duty of fair presentation’ and will apply to all insurance contracts worldwide that are subject to English law when arranging your insurance. This means you and your insurance provider have an obligation to: • Disclose material facts that you know or ought to know about the risk • Disclose sufficient information in a reasonably clear and accessible manner to put a prudent insurer on notice that it needs to make further enquiries to reveal such material circumstances • Not make a misrepresentation There is a continuing duty for you to disclose all material facts when arranging your insurance and to disclose any changes in material facts when renewing and/or during the lifetime of the policy.
Insurance Premium Tax In November 2016, Chancellor Philip Hammond announced the rate of insurance premium tax is set to rise from 10% to 12% from 1 June 2017. This
The onus is on you. A material fact is information an insurer would regard as likely to influence the acceptance and assessment of your risk proposal. If you are in doubt as to whether to disclose certain information, our advice is to do so - share/disclose anything you think may be relevant. The onus is on you. Providing you fulfil your obligations under the new legislation you can expect some positive outcomes in return as TIA 2015 imposes increased responsibility upon insurers to behave fairly and reasonably when you make a claim. It is worth noting that if it can be shown you have made a deliberate or reckless failure to disclose issues of relevance insurers may avoid the policy.
We’re here to help. Don’t let any of the above burden you or create uncertainty about how your insurances will be affected. TL Dallas are on hand to help and if you have any concerns please get in touch. The Insurance Act 2015 can be viewed in full at legislation.gov.uk
will be the third increase since November 2015 and means insurance premium tax will have doubled from 6% to 12% in just over 18 months. For further details and advice please contact your nearest branch.
Duty To Warn Duty to Warn describes the obligation of an experienced construction professional to warn others of defects in works - even if the professional isn’t directly responsible for that aspect of the works.
The court left open the question of circumstances where the defective was not obviously dangerous.
There are a number of well known cases demonstrating the courts attitude to Duty to Warn and demonstrating the cost to construction professionals who either ignored, or were oblivious to the risk.
• Contracts will often place a higher obligation on the contractor than reasonable skill and care, even so, there is an exposure through both the Tort of Negligence and the implied term in the Supply of Goods and Services Act 1982. • The more experienced, skilled or specialist the contractor/construction professional is, the higher the obligation may be considered to be. • Contractual requirements to inspect, monitor, supervise, etc. create a contractual requirement of, not only a Duty to Warn, but to oversee the rectification/remedy of the defect. • New Engineering Contracts (NEC) require both parties to give early warning of anything which may delay the works or increase costs. If the contractor fails to comply with this obligation they will be unable to claim for additional costs/delays following any subsequent compensation event. • The Construction (Design and Management) Regulations 2015 require that the principal designer ensures the works are carried out in a way that minimises Health & Safety risks. • The Health & Safety at Work Act 1974 creates obligations to warn both employees and third parties about the dangers present in a place of work.
How can a Duty to Warn be created? There is no general duty to warn in English and Scottish law however, there are circumstances in which a duty can exist. In it’s judgement on the case of Plant Construction Plc vs Clive Adams Assoc., the Appeal Court offered the following conclusions: • There will usually be an implied (sometimes explicit) contractual term that a contractor shall perform a contract using the skill and care of a reasonably competent contractor • The circumstances of a particular contract will establish the scope of that obligation • Where an experienced contractor is involved and the design of the works is not only defective, but obviously dangerous there is an “overwhelming case” that the contractor is bound, as part of it’s obligation, to use appropriate skill and care to warn a client of dangers it perceives
Other considerations could include:
What should you do? • • • • • •
Understand your exposure to Duty to Warn, through the mechanisms listed. Educate your staff to reinforce their understanding of their responsibilities, and create a simple process for them to raise concerns promptly with senior management and in turn other contractors and employers. As a minimum, warn of all dangerous or potentially dangerous defects. Make sure that your company’s warnings to clients or other contractors are clear, unambiguous and in writing. If your warning isn’t strong enough the courts may still consider you failed in your duty! Check that your insurance broker understands Duty to Warn and your potential exposure to it. Always seek to buy Professional Indemnity Insurance with a specific Duty to Warn extension.
For further details and advice please contact our construction specialist, Mike Mitchell email@example.com or call 07496 888411.
The concept of a duty to warn is an important one, but in some respects an undeveloped area of the law. The cases, which mainly come from the English courts, demonstrate that it is not easy to succeed in actions which allege that construction professionals breached their duty to warn. There are two legal consequences of failing to discharge a duty to warn. One is in the possibility of a professional indemnity claim. The other is the possibility of a health and safety prosecution under the Health and Safety at Work Act 1974. The ‘rules of the game’ are the same in either case, and I would suggest that the underlying rationale is the application of common sense, and an abundance of caution. If a construction professional, during the course of an inspection/site-visit, is concerned that the works are being carried out in such a way that there is a health and safety risk, that should be immediately flagged up to all of the relevant parties. However, as is demonstrated by the case of Goldswain -vBeltec Ltd in 2015, a structural engineer (and by extension any designer) is entitled to assume that their drawings will be followed by the appointed contractor, and there is no obligation to supervise the works to ensure such compliance. Alistair Dean, Partner, Anderson Strathern firstname.lastname@example.org
Credit Insurance = Strong Foundations Economically, everything starts and ends with the construction industry and the market itself is a useful barometer of what is happening out there (Guardian Economic Growth). The association of business recovery professionals, â€˜R3â€™, recently reported that late payments from a customer and the knock on effect from a bad debit is responsible for at least one fifth of UK corporate insolvencies in the last twelve months. The latest research reveals that this trend hasnâ€™t improved since 2014.
Over half (57%) of insolvency practitioners identified construction as the sector with the worst track record for late payment. Late payment problems and relatively high insolvency rates are not a coincidence. If the sector could diminish the extent of the issue it would see an improvement in its business survival rate. 2016 saw a number of high profile construction insolvencies including, Cardy Construction Ltd,
LSC Facades Ltd, HOC (UK) Ltd, UK Construction Ltd and The Dunne Group. The knock on impact of these has been significant to suppliers and contractors, short term cash flow being the immediate concern. Our market provides specialist construction wordings and bespoke policies that recognise the idiosyncrasies of contracting on JCT or NEC contracts, along with those supplying goods and services into the construction sector. Most insurers will provide coverage relating to applications (as opposed to traditional invoicing) and final account balances but others will provide additional cover for retentions, variations, day works and even pay when paid style clauses covering against upstream third party insolvency.
“Late payment problems and relatively high insolvency rates are not a coincidence. If the sector could diminish the extent of the issue it would see an improvement in its business survival rate” Choosing an insurance partner is not straightforward in any sector. Where contracting is involved, this is further complicated by the different types of cover on offer, as mentioned above, but also the speed with which insurers typically pay claims.
Leading construction insurer TMHCC recently reported that where some subcontractors were having problems obtaining valuations from The Dunne Group Ltd in administration, TMHCC were able to use their own quantity surveyors to value works removing the payment delay risk and avoiding the possible domino effect and support their clients cash flow. The good news is that JCT, in recognition of the Construction Supply Chain Payment Charter, is intending to introduce specified payment dates after interim valuations that should lead to greater certainty throughout the supply chain. In short, monthly IVD’s will be on the same day each month with payment due 7 days from valuation with a final payment date of 14 days. It remains to be seen whether this can be achieved, but certainly a step in the right direction. Construction companies are often asked to provide some form of bond to the main contractor or the client either as part of a tender or, in agreement with being awarded the contract. Some companies will arrange a ‘bank bond’ for these, however, providing a ‘Surety bond’ instead can be a massive advantage to the firm as it is usually unsecured and off balance sheet, meaning it doesn’t eat into the banking facilities so allows more working capital for the company. At TL Dallas, our Credit Insurance department supports the client with any trade insurance negotiations, protecting against the impact of a bad debt and arranges Surety bonds for the client to provide to the main employer to secure the contracts. For further details and advice, please contact the Credit Insurance team in Bradford on 01274 465500 or Falkirk on 01324 717466.
Safeguarding your treasures Does your insurance policy reflect increases in value? Valuable jewellery means a lot of different things to different people. It can mean a precious family heirloom; a reminder of a special moment in your life, or simply a favourite piece received as a gift.
a trusted, authorised retailer who is long established in the industry to fully understand the product you are purchasing.
In recent years, as investors have continued to be more cautious about unpredictable assets like equities, the monetary value of some fine jewellery has been growing. With the price of gold reaching record highs in recent times, a continued interest in precious gems has also led to the growth in value of stones - in particular rubies, emeralds and sapphires.
TL Dallasâ€™ Helene Brown comments, â€œWhilst the increase in the values of precious metal and stones is great news from an investment perspective, owners of valuable jewellery and timepieces should regularly review the sums insured to ensure there is no shortfall in the unfortunate event of damage, theft or loss.â€?
In fact, coloured stones have had a renaissance of late both in desirability and value. The strength of the coloured gemstone market proves that they are just as coveted as a diamond. Although they are a slightly more informal choice, the physical attributes of these gems make them highly desirable and some can be just as rare as a diamond. When investing in either fine gemstone jewellery, or high end timepieces, you should always visit
To discuss your individual requirements in more detail, please contact Helene Brown email@example.com or call 0131 322 2633.
Ask the Experts… Hamilton & Inches specialises in the emotional and meaningful pieces that often turn out to be most cherished in people’s lives. It is not the amount of money spent that creates this bond, rather the feeling and emotion behind the giving of the items, that inspires this attachment. These pieces, whether a watch for a 21st birthday, a pair of ruby and diamond ear studs for an anniversary or a diamond set engagement ring, all create a strong bond with the wearer. As the emotional value attached to these pieces increases with time, so too has the financial value, seeing an increase in purchases of precious gems.
“I am a great believer, and always have been, that jewellery should be worn and enjoyed”
Stephen Paterson, Chief Executive of Hamilton & Inches says, “I am a great believer, and always have been, that jewellery should be worn and enjoyed. For someone to achieve that feeling of confidence, it is vital that dependable and flexible insurance cover is in place. As part of that, it is important to have jewellery regularly checked and valued so you know, if the worst should happen, a precious piece can be properly restored or replaced by your jeweller.’ For more information please contact our Personal Insurance team in Bradford on 01274 465500 or Edinburgh 0131 322 2636 who can provide further advice or put you in touch with a local, reputable valuer.
Our Brand We have recently refreshed our brand to better reflect the TL Dallas values, people, and services. This includes a new logo, fonts, and colour palette. To create the new colour palette we went back to our roots and sought help from one of our Edinburgh clients - none other than Kinloch Anderson: the official Tailor and Kiltmaker to HM The Queen; HRH The Duke of Edinburgh; and HRH The Prince of Wales. Currently managed by the fifth and sixth generations of the Kinloch Anderson family, the tailor possesses a comprehensive library of official tartans. We managed to track down the Dallas tartan, which was then broken down by our designers into the individual wool colours. Our bold new palette, incorporating the wool colours, will be used on all future publications and can be found throughout our new, easyto-navigate website: offering industry/product specific information, risk bulletins, company news, and an office/people finder.
Main Identity Commercial Insurance Pantone 280c C:100 M:72 Y:0 K:18.5 #064486 Overlays in White/Paper
Events and Training
C:75 M:0 Y:77 K:0 #36AA64 Overlays in White
C:85 M:65 Y:45 K:44 #2C3E4F Overlays in Gold (#FDD368)
C:0 M:68 Y:100 K:0 #EA6B20 Overlays in White
C:61 M:80 Y:0 K:0 #7E4B95 Overlays in White
Credit Insurance C:0 M:91 Y:71 K:6 #DA3040 Overlays in White
Use of colours in gradients Light shade
TL Dallas Financial Services
Hats off to the Taxman If you own a small business there’s a smarter way to buy life cover for yourself and your key employees. With a relevant life policy the business makes the payments, not the person who’s covered. That means you won’t pay any national insurance contributions or income tax on the premiums but you still get the benefits of corporation tax relief. The table below illustrates how a relevant life policy can cut company costs: How a relevant life policy can cut company costs Premium Company gross cost
Company net cost
Ordinary life cover
Relevant life policy
Employees National Insurance contribution at 2%
Income tax @40%
Employers National Insurance contribution at 13.8% £238
Total gross cost
Corporation tax relief at 20%
Now, how does that look for a head start for your business? Please note, this is based on our understanding of the current tax law which could change in the future. To find the best way to protect you and your family, talk to us today. Contact Gary Nixon - firstname.lastname@example.org or call 01274 465 557 or Jane Sharpley - email@example.com or call 01274 465 597 Source: *Assumes that corporation tax relief at 20% has been granted under the ‘wholly and exclusively’ rules. In both cases we’ve assumed a payment of £1,000 each year for the life cover on an employee who’s paying income tax at 40% and employee’s National Insurance at 2% on the top end of income. We’ve also assumed that the employer is paying corporation tax at the small profits rate of 20% and will pay employer’s National Insurance at the contracted-in rate of 13.8%.
TL Dallas Team Spotlight:
Michael Gregson Area of Business: Private Clients
What does your role entail?
To develop and maintain relationships with clients and insurers, as well as working alongside colleagues within the Group to create and implement a strategy for Private Clients going forward.
Most important aspect of your role?
Identifying and developing relationships with Private Clients
What do you find most rewarding?
Working closely with clients to identify their specific needs and deliver a solution which meets their requirements and expectations.
“I believe there is no replacement for dealing with an individual” 12.
Most challenging part of your role? Setting myself and the team apart from our competition in a challenging and “swamped” market.
Our industry is changing at a fast pace, especially through the use of technology and social media. That said, I believe there is no replacement for dealing with an individual, someone who will take time to meet with you, understand your needs and make sure a tailored solution is available. Many of the clients I speak to are surprised to learn when they review their sums insured they are under insured, especially on contents and valuables. I have access to insurers with specialist policies that are not available on line and a range of underwriters who understand the particular bespoke cover required by our clients needs. We work with a panel of insurers who will respond quickly to claims often settling in cash within 48 hours. As well as arranging insurance, I work alongside a number of Associates, such as Valuers, Security Firms, Solicitors and Wealth Managers to ensure our clients receive the best possible service at all times. Contact Michael Gregson firstname.lastname@example.org or call 07900 647423
Client Insight -
Founded in 2011 by two leading industry professionals; Bob White, one of the founders of Mace, and Gareth Stapleton, ex-Hawkins/ Brown and PDCM, RISE is a multinational strategic consultancy. Our expertise extends across strategic and management consultancy, development management, design management, project management and strategic planning, programme management, preconstruction management, and construction management. Our management solutions are tailored to the specific needs of our clients and our projects. We organise our teams to best address the objectives of each proposal and ensure that our specialist expertise across diverse industry roles is fully integrated into our management solutions. Whilst RISE is able to advise and deliver across the entire project lifecycle, the emphasis is on front end control. Dedication, experience and vision are the key ingredients necessary to successfully deliver the world’s most challenging and iconic projects. Over the course of their careers our staff have used these qualities to help create enduring landmarks for cities around the world. Our mission is to re-establish a culture of integrity and trust across the delivery of
construction projects. This mission extends not only to the quality of our products, but is principally entwined in our attitudes and approach. A significant illustration of this philosophy in our business is that we do not accept any fixed price work. As a direct result, RISE does not have to be engaged in the unacceptable practices evident in the industry and prevalent throughout the construction supply chain, and which are directly resultant from vested commercial interest. Ultimately, RISE offers valuable and inspiring leadership. We are the stewards of our clients’ visions and are prepared to be mentors of the project team. Our high quality portfolio of projects and clients is testament to the value of our offering. Over the past five years we have worked on several prestigious projects including the Serpentine Sackler Gallery by Zaha Hadid, the refurbishment of the Royal Opera House and Amazon’s new headquarters in Shoreditch. Our head office is in London. We also have offices in Bath, Cheltenham, Abu Dhabi and Shanghai. We employ 90 staff and in 2016 we were awarded the title of Construction News Construction Consultant of the Year, and Constructing Excellence SME of the Year. To find out more please check out our website: www.rise.eu.com 13.
TL Dallas Our Community As a business we are lucky to be in a position to help those less fortunate then ourselves, and we have been doing so through the TLD Charitable Trust. Launched to mark our forthcoming centenary year in 2019, we are proud to have distributed in excess of £33,000 to our chosen charities to date, but we still have a way to go. All our employees throughout the UK will be involved in numerous charity initiatives as we aim to raise over £100,000 by the end of 2019. This is a massive challenge for all involved with TL Dallas but with hard work and determination we feel it is possible. We would welcome any ideas, donations or offers of help. For further details please visit Our Community section under About Us. http://www.tldallas.com/about-us/ or email email@example.com Text “TLDA10 £10” to 70070 to donate £10 to TLD Charitable Trust and make a difference today. https://www.justgiving.com/tldcharitabletrust